Canada: Recent Judicial Developments Relating To Aboriginal Rights In The Context Of Ontario´s Mining Act And Its Reform

The Platinex Case

On May 28, 2008, the Ontario Court of Appeal granted an appeal
by eight Aboriginal leaders seeking to reduce the sentences that
the Ontario Superior Court had imposed on them after finding them
in contempt for organizing a protest at a potential platinum mining
site. In its submissions to the appeal court, the mining company,
Platinex Inc., had acknowledged that the matter "would
ultimately be settled only through negotiation, and that no good
purpose would be served by keeping the appellants in jail any
longer." The original sentences were to be for six months, and
the leaders were released after having served 68 days of their
sentences.

The appeal court's judgment in Platinex Inc. v.
Kitchenuhmaykoosib Inninuwug First Nation is the most
recent episode in a judicial saga involving Platinex, a junior
exploration company, and the Kitchenuhmaykoosib Inninuwug First
Nation (KI), an Ojibwa/Cree First Nation occupying a reserve on Big
Trout Lake in northern Ontario. The initial action was instituted
in 2006, following seven years of negotiations between Platinex and
KI concerning an exploration program to be conducted on
Platinex's unpatented mining claims located on traditional
non-reserve KI land. During the negotiations, which occurred in
2001, KI had adopted a moratorium on all mineral activities until
proper consultations had taken place.

In July 2006, an interim order was granted by the Ontario
Superior Court barring Platinex from engaging in its exploration
program for five months, conditional upon KI setting up a
consultation committee to draft an agreement that would allow
Platinex to conduct its exploration activities. This injunction was
later extended by a few months, but the court thereafter refused to
renew the injunction. In so doing, the judge acknowledged KI's
perspective but observed that no concrete evidence supported
KI's assertion that Platinex's exploration program could
threaten KI's culture and heritage. The court also praised
Platinex for its proposal to act cautiously, with constant
consultation and attention to KI concerns. In October 2007, the
court issued an order (the Permission Order) allowing Platinex to
proceed with the first phase of its exploration program.

In December 2007, the court found eight KI community leaders in
contempt of the Permission Order for having prevented
Platinex's employees from beginning the first phase of the
exploration program. The evidence was that these leaders, along
with other community members, had prevented Platinex's drilling
staff from entering the village's airport and that Ontario
Provincial Police First Nation police officers had threatened them
with arrest if they did not leave KI's land.

The court sentenced the eight KI leaders in March 2008 to six
months' imprisonment for contempt. Significantly, the court
stated that the desire of Aboriginal communities to protect their
land, cultural heritage and way of life does not supersede a court
order granting a corporation the right to proceed with economic
development activities on its land. Among the aggravating factors
found by the court was the fact that the eight individuals were
community leaders who had used their position of authority to
incite other community members to repeatedly and continuously defy
the order. In the court's view, such flagrant and repeated
defiance warranted a severe prison term.

The Frontenac Case

The judgment sentencing the eight KI leaders in March 2008
followed an earlier decision of the Ontario Superior Court in
Frontenac Ventures Corporation v.Ardoch Algonquin First
Nation sentencing two Aboriginal leaders of the Ardoch
Algonquin First Nation to six-month prison terms and fines of
$15,000 and $25,000, respectively. The court found them in contempt
for organizing a peaceful protest at a potential uranium mining
site. These sentences were later set aside by the Ontario Court of
Appeal on July 7, 2008, at the same time as it released its
decision on the Platinex appeal. In reversing the
decision, the Court of Appeal stated that the sentencing principles
developed by the Supreme Court of Canada for the sentencing of
Aboriginal people convicted of criminal offences were
"applicable when fashioning a sentence for civil or criminal
contempt on the part of aboriginal contemnors." In a passage
that has potentially far-reaching implications for companies
involved in mining activities across Canada, the Court of Appeal
emphasized the implications of enforcing injunctive relief based on
the Mining Act (Ontario) on land subject to Aboriginal
land claims. In the Court of Appeal's view, such injunctive
proceedings inherently create disadvantage for Aboriginal
communities because of the absence of any consideration about
Aboriginal land claims or interests in the Mining Act. In
this context, according to the Court of Appeal, "the use of
incarceration as the first response to breach of the injunction
dramatically marginalizes the significance of aboriginal law and
aboriginal rights."

Other mitigating factors reviewed by the Court of Appeal
included that (i) the Aboriginal leaders were first-time offenders;
(ii) the protests were peaceful; and (iii) the community had
already purged their contempt by the time the sentence was imposed,
having undertaken not to continue their protests and blockade
activities. In light of these factors, the Court of Appeal decided
that incarceration and substantial fines were inappropriate. In a
possible allusion to Platinex, the Court of Appeal in
Frontenac did, however, leave open the possibility for
courts to impose incarceration and fines on those found guilty of
contempt, including Aboriginal people, in other circumstances:

That is not to say that incarceration is always out of place in
civil contempt cases. In some cases, including potentially this
case down the road, incarceration and substantial fines may be
necessary. However, it would be wrong to cross this bridge now for
these first offenders in a situation that cries out for dedicated
negotiation among Ontario, the AAFN and Frontenac with a view to
reconciliation of the competing interests.

Indeed, in a Statement of Claim filed on May 8, 2008, Platinex
is now claiming $10 million from KI alleging that "as a result
of threats, intimidations and breaches of Court orders by the
leadership and members of the KI communities, it has not been able
to access its Big Trout Lake property since February 2008."
Platinex is also claiming $50 million from the Ontario government
alleging that it failed its duty to consult KI and for its failure
to warn Platinex of its inability or unwillingness to enforce the
rule of law in Platinex's claims. The outcome of these recent
claims remains to be seen.

Implications of these Decisions

Albeit from different standpoints, the recent judicial
developments in Platinex and Frontenac may be
relevant to the reform of Ontario's Mining Act, at
least with regard to the inclusion of provisions mandating broader
consideration of Aboriginal and treaty rights, and related issues.
The Ontario Government is committed to modernizing its Mining
Act and is currently conducting public consultations in this
regard.

On August 11, 2008, the Ministry of Northern Development and
Mines (MNDM) released a discussion paper titled "Modernizing
Ontario's Mining Act — Finding a
Balance." This document states that the main purpose of the
reform is to achieve a balance between economic interests and other
interests, especially those of Aboriginal communities. It
identifies five critical policy issues that must be taken into
consideration in the review of the Mining Act. Four of
these issues directly address Aboriginal issues: (i) adjustment to
the mineral tenure system, including free entry, to assure
investment security while taking into account other interests; (ii)
consultation and accommodation relating to Aboriginal and treaty
rights; (iii) regulatory processes for exploration activities on
Crown Land, including consultation and accommodation with
Aboriginal communities; and (iv) land use planning in Ontario's
Far North. The discussion paper sets out the current consultation
process. In addition to being invited to participate in public
discussion sessions, interested parties may submit written comments
by October 15 to the MNDM.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

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